Minimum Wage Hikes Spurs the Start of the “Great Labor Deleverage” in the Restaurant Industry

Panera’s profit and loss statement, according to Chief Financial Officer Mike Bufano, showed that “labor cost was again the most significant driver of operating margin decline.” Statutory increases in minimum wage along with inflation and benefit costs associated with the Affordable Care Act were noted by Bufano as two of three factors “contributing to the labor deleverage.”